Unemployment applications drop to lowest in Washington
New claims for unemployment benefits dropped to the lowest level after two record setting years in 2011. Applicants for unemployment fell in a row, suggesting that the job market recovery was gaining speed. Overall, average length of time in which the Washington workers collected the benefits has reduced from 42.2 weeks in 2010 to about 36.2 weeks near the end of 2011. Still, unemployment in Washington remains high.
Unemployment applications measure the rate of layoffs. Though the job cuts have fallen sharply, the employers have been slow to start hiring again. The Labor Department says new applications for unemployment benefits dropped last week by 4000 to a seasonally adjusted 364,000. That is the lowest number since April 2008- a pace that usually indicate hiring is strong enough to decrease the unemployment rate.
Applications for unemployment fell for the third week in a row. The Conference Board also reported to the clients that its measure of future economic activity had a big increase last month. It was the second straight gain, signaling that the U.S. economy was picking up speed and the risk of another recession was fading.
Encouraging economic reports sent stocks stating the drop in the number of applicants and the latest sign that the job market is healing. Even the Conference Board notified, the two months of solid gains in the index signal that shows US economy was gaining speed and the danger of another recession was fading. The index of leading economic indicators rose 0.5% in November following a 0.9% gain in November, which is the strongest in eight months.
And in yet another GDP report, the Commerce Department says the economy grew at an annual rate of 1.8% in the July-September quarter which was the fasted growth, up from 1.3% in the April-June quarter. But it was slightly down as compared to last month’s estimate where the economy expanded at a 2% rate over the summer. In other economic news, a survey showed that a gauge of future economic activity increased more than expected in November.
In 2011, an estimated 440,000 people received benefits, which is nearly 12% less than the all-time record of 503,000 in 2010. In 2009, 470,231 individuals collected unemployment benefits. As per the Washington State Employment Security Department this year the benefit payouts will total about $3.2 billion, compared to $4.6 billion in 2010 and $4 billion in 2009.
The declination in the length of time in which the Washington workers collected benefits is due to an improved economy and also because the unemployed workers simply ran out of benefits. As per the Employment Security Commissioner, about 70,000 workers will have exhausted all of their unemployed benefits by the end of December which will be the most ever during a period when extended benefits were in effect.
The steady decline in unemployment claims may also indicate a further decline in the unemployment rate which dropped to 8.6% in November from 9% the month before. The December rate is scheduled to be announced on January, 6. If the claims keep dropping, the unemployment rate might fall as low as 8 percent before the November elections. Economists will be looking forward for January 6 to check out how many jobs were included this month.
Now, the employers are exhausting their benefits and the majority of people are trying to get back into the workforce. With economy getting a little better and business adding more jobs, the job market is becoming fairly healthy.